research and enterprise

Research and Enterprise

Business Awareness Programme ‘Business Planning – how do I

create my first business?’


Starting in BusinessBusiness Awareness

Workshop‘Business Planning – how do I create my

first business?’


Bernard Curren MCMIResearch and EnterpriseKnowledge & Innovation Manager


Starting in Business Programme

Welcome to Planning and RegulationGeneral introductions

DomesticsOutline of the Starting in Business Programme

Outline of today's Planning and Regulation session


Planning and RegulationSmall Business- what does it mean?

Business Plan…why have one? Business Failure…some considerations!!!

Legal status Business names, trade marks, licences

Insurances , Tax, VAT Business Insurance

Health and Safety, Employment Law Premises

Contracts ..terms and conditions


What it means to be a small business

Smallness means greater emphasis upon:

Standing alone Operating with limited resources

High levels of uncertainty and external dependency Being close to the customer

Coping with ‘total’ responsibility Managing a wide range of task structures


What it means to be a small business - continued

Greater scope for individual dominance and responsibility

Managing networks with suppliers, customers, accountants.lawyers, bankers etc.

Wide scope for change and flexibility


What is a business plan?&

Why have one!!!


Planning is about looking to the future to minimise

risk and maximise opportunity


Why have a Business Plan?3 Main reasons

A document setting out what you aim to do (setting targets and actions)

Reducing the risk of failure/ increasing the likelihood of success

Possibly assisting with the raising of business finance

Make your mistakes on paper!!


The reasons for preparing a Business Plan?•To raise money

•Minimise Risk

•Increase success

•Reminder of why/who/what/when

•Assists in promoting the business to backers, suppliers, landlords and customers

•To know where you are going. To know when you have arrived

•Keeps focus on business issues

•It encourages realism

•Builds confidence in you and your team


Important parts of the Plan

The vision….(where you are going) Why, When, How

The Market……..Segment, Size, Trends, Customer profile, Competition, Suppliers and Distribution

Financials…….Sales forecast, Cash Flow Forecast Profit and loss Forecast


Business Plan• Title page• Synopsis of the plan• Background information• Form/status decision – dis/advantages• Key personnel – details in CV• Description of product/s and or service/s• Premises – location, type, size• Market research activities, findings and results• Written short, medium an long-term objectives• Marketing plan• Financial plan• Contingency plan


The CashflowThis important document helps to:

• Establish the amount of money needed and when it is required• Ensure that capital expenditure is controlled• Encourage efficient use of resources• Identify any shortfalls• Provides facts to help with decision-making


Reasons for Failure

• Under pricing• Inadequate cash flow• Lack of capital• Over-trading• Change in market demand• Ill health• Failure to keep Bank informed• Third Party debt – major customer

• Over estimating sales

• Failure to control costs

• Losing control over cash

• Inadequate market research

• Taking unnecessary risks

• Failure to meet client nee


Legal Structure

Sole Trader

Partnership

Limited Liability Partnership

Limited Company


Sole Trader and PartnershipsYou must inform -Inland Revenue )

- Contributions Agency )HMRC- Customs & Excise )

In Law: 1) The Business and proprietor/s are the same.

2) You are solely/jointly responsiblefor all debts

Tax Assessment: 1) Self assessed2) Need to keep records for 6 years

Tax Calculation: IR 30th SeptemberYou 31st January

Payments on account – January 31st and July 31st

Penalties for late returnsNo external audit – the business is private


Limited CompaniesSet Up Minimum 1 Shareholder,1 Director and Company Secretary

Buy Ready-to-use CompanySolicitor/AccountantDo-it-yourself – via the internet or formation agent

Registration Companies House

Documents Certificate of Incorporation and Memorandum and Articles of Association

Employees Pay as you Earn

Company Profits Corporation Tax Accounts must be audited annually by an external auditor – additional costs


Social Enterprise Objectives Trading Social Purpose Owned by the community

Not for profit legal structures: Company limited by Guarantee Charity Industrial and Provident Society Social Firm Community Interest Company


Business Names, Logos & Licences

Regulated by Business Names Act 1985Using your own name

Passing offChecking for names in use

Using a trading nameConsider domain names

Trademarks

Business Registration…..HMRC…..Local authority……HSE


Data Protection Act 1998The 8 Data Protection Principles:Data shall be:

1. Fairly & lawfully processed2. Processed for limited purposes3. Adequate, relevant & not excessive4. Accurate5. Not kept longer than necessary6. Processed in accordance with the data subject’s rights7. Secure8. Not transferred to countries outside the EEA without adequate

protection

www.informationcommissioner.gov.uk

Do you need to register?Find out at:


What is VAT?

Value Added Tax A tax on the supply within the UK of: Goods

Services

Imports and acquisitions into the UK Charged by a taxable person/entity In the course/furtherance of business


VAT Registration

AdvantagesClaim VAT on most

purchases thus:• Reducing net

expenses • Reducing costs to VAT

Registered Customers, Exports and EC Sales

Commercial credibilityDiscipline of keeping records

up to date

Disadvantages• Charge VAT on all Taxable

Sales• Submit VAT Returns (usually

quarterly)• Need to keep records for 6

years


VAT Liability/Rates Calculated on sales value over a rolling 12 months. Accounted for (typically)

quarterly

Compulsory Registration threshold = £67,000 Voluntary Registration at any time below thisDe-Registration threshold = £62,000?

Taxable Supplies: Non Taxable Supplies:Standard 15% - ExemptReduced Rate 5% - Outside the ScopeZero Rate 0%


What Insurance will I need? Legal Requirements (compulsory)

Vehicle InsuranceEmployers Liability if you employ people

Other forms of InsurancePublic Liability

Product liability – if you sell, repair or supplyProfessional Indemnity – for consultants

Goods in Transit, Loss of money, FireBuilding and Contents

Personal Insurances – such as pensionsHealth & Life Insurances


Do you need a Licence?Local Authority

Theatre, child-minding, taxi service, nightclubs, pet kennels, sex shops etc

Environmental Health DeptHotels, restaurants, tattooing, massage, acupuncture, abattoirs, etc

PolicePossession or sale of firearms, to work with children

MagistratesSale of alcohol, betting shops, gaming

HM Customs & ExciseBureau de change, money transmission, third party cheque cashing

Office of Fair TradingCredit Licence; Lending money, debt collection, hiring, leasing, etc

Planning OfficerBuilding regulations, alterations, change of use etc


The Law and your BusinessCustomer Obligation:

The Supply of Goods and Services ActThe Sale of Goods ActTrade Descriptions Act

Consumer Protection ActThe Unfair Contract Terms Act

Consumer Credit ActsWeights and Measures Acts

Unsolicited Goods and Services ActsThe Prices Acts

The Goods and Drugs ActThe Distance Selling Regulations

Expert advice can be obtained from the Trading Standards Department of your Local Authority


Health & Safety

Health & Safety at Work Act Offices, Shops and Railway Premises Act

Factories Act Fire Precautions Act

Health & Safety (First Aid) Regulations Act www.hse.gov.uk for risk assessment checklist

http://www.hse.gov.uk/


PremisesTrading from HomeHouse DeedsCapital Gains TaxPlanning IssuesHome Insurers

Commercial RentingLicense LeaseEasy in, easy out - Period- Break clause- Full repairing- Assignment- Sub-letting- Landlords legal fees- Rent Review dates- Service charges


Terms and Conditions of TradingDelivery timingPayment dates

Ownership (retention of title)Cancellation

PriceRefunds policyForce majeure

Consequential lossIPR issues


Useful Websites

Business Link… http://www.bldc.co.uk/ BERR http://www.berr.gov.uk/ HM Revenue & Customs www.hmrc.gov.uk

www.plymouth.ac.uk/businessservices

Contact Numbers: Local Business Link Office 0845 600 9966

http://www.bldc.co.uk/

http://www.hmrc.gov.uk/

http://www.plymouth.ac.uk/businessservices

research and enterprise

Documents

enterprise planning

business programmewelcome

regulationsmall business

business issues

business planwhy

enterprise reasons

decisionmaking research

team research